The Brokerage Relationships in Real Estate Transactions Act (BRRETA) requires licensed agents in Georgia to provide to buyers material adverse facts or defects pertaining to the physical condition of the property that could not be observed by routine inspection.
Sellers, unless they are licensed agents, are not similarly required under BRETTA. There is no corresponding statute or legislation governing the conduct of an unlicensed seller. However, under Georgia case law, a seller does have a duty to disclose defects in the property that the seller knew about or should have known and that a buyer would not have observed upon a reasonably diligent inspection of the property. If a defect is discovered that a seller should have disclosed, the seller can be sued in a civil action for fraud.
There are 4 basic elements that must be proved in a case for fraud for non-disclosure.
The GAR Seller’s Property Disclosure Statement includes the question “Have there been any inspections of the Property in the past year?” If the answer is yes, the seller is not obligated to provide the report, but if there are defects in the report that have not been repaired, smart agents and sellers should disclose. Most buyers will request the other inspection reports anyway and not enter into a contract without first reviewing them.
Examples of Situations That Require Disclosure of a Bad Report.
Smart alternatives to dealing with a bad inspection report.
Only Latent or Hidden Defects Need Be Disclosed by the Seller
Georgia law only requires a seller to disclose latent, or hidden, defects. If the defect has been corrected such that it is no longer a defect, the seller arguably has no general duty under common law to disclose the fact that at one time the condition may have been defective. The law does not require sellers to disclose every past repair made to their homes; rather, they must inform potential buyers of current defects of which they are aware.
Weissman, Seth. The Red Book on Real Estate Contracts in Georgia (pp. 832-836). BookBaby. Kindle Edition.
Safe Real Estate video with Seth Weissman
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